India to exempt digital rewards from tax
According to a new report from a local media, two senior officials told ET that the Indian government will soon update the crypto community on the developments and are currently working on it. According to the bill recently passed by the authorities, virtual digital assets, or VDAs, will be taxed at a rate of 30%.
The current definition of VDAs under India’s official tax law includes items generated using cryptography or “otherwise”, making it open to interpretation. Due to a lack of clear definition, the scope of VDAs becomes quite broad, which also includes digital rewards and e-vouchers, as they share some of the characteristics of VDAs. Currently, digital rewards are often rewarded by blockchain games and similar platforms for loyal players and users, and even some credit and debit card companies offer the same.
“These will not be covered by the definition of VDAs; we will clarify…” said one of the officials. A notification regarding this decision will be issued by India’s tax agency, the Central Board of Direct Taxes.
Delay in regulation
India’s official cryptography bill has not been brought to Parliament for discussion. The bill was due to be introduced in the first quarter of 2022 but was postponed. the India’s Finance Minister, Nirmala Sitharaman, said she doesn’t want crypto regulation to be rushed. “I understand the impatience, but I’m sorry, that’s how it’s going to be,” she said.